QS Study

Rules of Listing of Shares in Stock Market

We know that only the member of the stock exchange can transact the shares in the market. So, a company willing to transact in a stock exchange must be a member of the stock exchange following the procedures prescribed by the concerned stock exchange.

To be a member, at first, it is required to apply to the stock exchange by the form provided by the stock exchange. With the application, the following documents must be submitted to the authority of the stock exchange. The documents to be attached to the application form are as follows:

  • Certificate of Incorporation given by the registrar of Joint Stock Company.
  • Certificate of Commencement.
  • Memorandum of Association and Articles of Association.
  • Copy of prospectus.
  • Activities and potentialities of the company.
  • Copy of agreement with underwriter and jobber.
  • Copy of an agreement with the management agent, board of directors, sales agent, and others.
  • Copy of at least three years of the balance sheet and other accounts for old companies.
  • Copy of agreement with financial institutes.
  • Statement of dividend and bonus systems.
  • Proper address of directors and the number of shares bought by them.
  • Description of shares and debentures application form.
  • A specimen of shares debentures and other instruments.
  • Description of capital structure and other sources of financing.
  • Copy of resolution of taking the decision to enter the stock market in the board of directors meetings.
  • Pledging letter of following the rules and regulations, enlisting and future planning and any kind of information needed to the authority.
  • Check for payment of registration fees and annual charges prescribed by the stock exchange.
  • Description of shareholder owns more than 10% share of the company.

Having the documents mentioned above, the management council of the stock exchange will examine the documents and if satisfied, it will give registration to the company. But for newly formed company all of the documents mentioned above may not be submitted. This is the proper way to register a company to the stock exchange.